H1 in review

Global physically backed gold ETFs1 saw inflows of US$38bn during H1, boosted by strong positive flows in June (Chart 1), marking the strongest semi-annual performance since H1 2020.2  All regions saw inflows last month, with North American and European investors leading the charge.

During the first half, North America accounted for the bulk of inflows, recording the strongest H1 in five years. And despite slowing momentum in May and June, Asian investors bought a record amount of gold ETFs during H1, contributing an impressive 28% to net global flows with only 9% of the world’s total assets under management (AUM). European flows finally turned positive in H1 2025 following non-stop semi-annual losses since H2 2022.

By the end of H1 the surging gold price and notable inflows pushed global gold ETFs’ total AUM 41% higher to US$383bn, a month-end record. Collective holdings in H1 grew 397t to 3,616t, the highest month-end value since August 2022 (Chart 2).

Regional overview

North America attracted US$4.8bn in June – the strongest monthly inflow since March – bringing total H1 inflows to US$21bn. Spiking geopolitical risks amid the Israel-Iran conflict boosted investor demand for safe-haven assets and supported inflows into North American gold ETFs. Although it held rates steady in June, the US Fed continued to express concerns about slowing growth and rising inflation.3 Markets are now pricing in three rate cuts by the end of 2025 and an additional two in 2026.

The investor response has been swift: US Treasury yields declined, and the dollar continued to weaken. Persistent policy uncertainty and ongoing fiscal concerns are likely to remain an overhang on the market, which in turn could help support gold ETF demand in the near to medium term.

European inflows continued for a second month, adding US$2bn in June – the strongest since January – and lifting the region’s H1 total to US$6bn. The UK led inflows in the month; although the Bank of England kept rates unchanged at its June meeting, the stance was generally dovish. 4 Combined with weaker growth, easing inflation and the cooling labour market, investors raised their bets on future rate cuts. This resulted in local yields declining and pushed up gold’s allure. Meanwhile, the eighth cut from the European Central Bank, uncertainties surrounding growth, and rising geopolitical risks generally, contributed to gold ETF demand in several major markets.

Asian flows flipped positive in June, albeit only mildly at US$610mn, ending at US$11bn – a record amount for any H1 period. India led inflows in June, likely supported by rising geopolitical risks in the Middle East. Japan recorded inflows for the ninth consecutive month (US$198mn, US$1bn H1), possibly driven by elevated inflationary concerns – particularly when the rice price surged.6 China only saw mild inflows in the month (US$137mn) as trade tensions eased and the local gold price moderated.7 Nonetheless, China’s H1 inflows of US$8.8bn (85t) were unprecedented amid spiking trade risks with the US, growth concerns and the surging gold price.

• Gold prices are currently trapped around the $3270 to $3420 region as the current consolidation pattern continues into the twelfth week. But rebounding dollar, which is driving the lower price action, the possibility of increased trade tensions could provide support.
• Japan has been notified in writing by US President Donald Trump that all Japanese imports into the US will be subject to a 25% duty starting on August 1.
• The leaders of 12 other nations received similar letters, alerting them of the imposition of 25% to 40% tariffs beginning next month.
• Trump’s announcements further damaged risk sentiment, which fueled a new surge in the price of gold, a classic safe-haven asset, as worries of a trade war were rekindled around the world by the repeated tariff threats.

Technical Triggers  

• Gold is expected to trade in the range of $3300 (~Rs 96000) and $3400 (~Rs 98500) this week.
• Silver has given a breakout of its range, trading above $37 (~ Rs 108,000). Now next target is $38 (~Rs 111,000)

Support and Resistance

In May 2025, Hong Kong witnessed a nuanced retail landscape: while total retail sales rebounded modestly, rising 2.4% year on year to HKD 31.32 billion ($3.99 billion), sales of luxury goods—specifically jewelry, watches, clocks, and other valuable gifts—contracted by 3.2% to HKD 3.87 billion ($493.1 million). This divergence offers critical insights into the shifting dynamics of consumer behavior, external macroeconomic pressures, and sector-specific challenges.

Several interrelated factors contributed to the luxury segment’s decline. First, surging gold prices significantly dampened consumer appetite for jewelry purchases, as higher costs discouraged discretionary spending on big-ticket items. Second, demand for luxury products on the Chinese mainland softened, reducing the influx of high-spending tourists traditionally pivotal to Hong Kong’s retail sector. Lastly, increased outbound tourism encouraged local consumers to shop abroad, further eroding domestic sales.

From January to May 2025, hard-luxury sales dropped by 9% to HKD 20.27 billion ($2.58 billion), while overall retail sales fell 4% to HKD 155.05 billion ($19.75 billion). These figures highlight a broader recalibration within Hong Kong’s retail environment, reflecting evolving consumer preferences and economic headwinds.